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Setting Records But Not Sitting Still

CEO of the year is easy ... Elon Musk gets the cake and the crown from me!

August 21, 2021


Razor-sharp focus. 

Order in chaos.

Those are some thoughts that come to mind when I think of Elon Musk, the machine behind the stupendous success of Tesla (NASDAQ: TSLA) and SpaceX. And when I call Musk the machine, by no means do I intend to call the teams at those companies second to Musk or anything. Those teams are, in my opinion, the best of the breed by a long shot in what they do. 

The pandemic has been a challenging environment for manufacturers, especially with the widespread disruption of supply chains. Yet, Tesla has managed to set record after record. Sure, Tesla is growing off a small base. It is important to note that electric vehicles are in growth territory, while the ICE (internal combustion engine) is undoubtedly on its way out. But here’s the thing. The ICE original equipment manufacturers still have nothing that really competes with Tesla. 

As with anything, context is essential. 

Tesla’s financial position wasn’t the greatest when the pandemic struck. But they managed to keep factories running (for as long as possible) to keep churning out cars. That helped with the cash flow, maintained Mr. Market’s confidence, and enabled secondaries to bolster the balance sheet. Tesla’s balance sheet today is in a good place.  

That alone would be a lot, right? 

But it doesn’t end there. Alongside, Musk et al. soldiered on and have two factories (Berlin and Texas) nearing completion in different parts of the world. Concurrently, Tesla ramped up the Shanghai Gigafactory! Again, that’s a lot of balls in the air through the pandemic!

And steadily, things have just become better. 

Tesla’s Q2 2021 delivered some stunning records for the business. The company produced and delivered over 200,000 vehicles. Operating margin hit 11.0%, and GAAP net income exceeded $1 billion! And they did all this through the semiconductor shortage, with the team redesigning circuit boards to substitute chips, writing new firmware, and more. 

Tesla delivered the quickest production car on the planet, the Model S Plaid, too. 

And it looks like the Full Self Driving suite’s beta testing is progressing in beast mode. 

Tesla still doesn’t spend on advertising. That’s because Mr. Musk is himself a walking advertisement! He’s probably better than the legendary Steve Jobs when it comes to product-to-market vision. So, Elon did some goofy things on Saturday Night Light. At the same time, the competition spent millions of dollars advertising their so-called Tesla killers on the same show. Talk about being a savage.

And Musk did all this while launching dozens or more rockets and catapulting astronauts to the international space station.

I know Musk rubs many folks the wrong way, but it is hard to dismiss the lasting contribution he has made to further humanity. Elon Musk, in my humble opinion, isn’t just the CEO of 2021. He’s the CEO of this decade.

Interested in learning more? Click here to see how some recent smart moves by CEOs of several active 7investing recommendations will pay off for shareholders going forward.

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